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Material weakness

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Definition Edit

Financial reporting Edit

A material weakness is

a deficiency, or combination of deficiencies, that results in more than a remote likelihood that a material misstatement of the financial statements will not be prevented or detected.[1]

Information system controls Edit

A material weakness is

a deficiency, or combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis.[2]

References Edit

  1. Cybersecurity: Actions Needed to Address Challenges Facing Federal Systems]], at 9 n.7.
  2. Information Security: Federal Deposit Insurance Corporation Has Made Progress, but Further Actions Are Needed to Protect Financial Data, at 2 n.4.

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